As a company founded in the same city as Bass Pro and O’Reilly Auto Parts, it’s not surprising that you may not have heard of Stamina Products, Inc. Nestled in the northwestern corner of Springfield, Missouri, Stamina Products has distributed in-home fitness equipment for 30 years. In addition to its most notable pieces, the AeroPilates reformers and the American Gladiator Home Gym, Stamina has also designed and distributed for brands and personalities such as Body by Jake, Denise Austin, Brenda DyGraf, Mia Finnegan, Kathy Smith and Suzanne Somers.
Over the past 30 years, Stamina has gained 73 employees and over 200,000 square feet of warehouse space. But this isn’t the typical story of a multi-million dollar company with humble beginnings. It’s the story of how five business partners overcame fraud, tough competition and even a death. In fact, those five partners – Barry Laurie, Kevin Gerschefske, Jeff Hutchens, Brent Swanson and Bob McBride – weren’t just partners. They were – and still are – friends.
As Swanson japed, “My wife and I recently celebrated our 30th wedding anniversary, but the crazy thing is that I’ve been married to four guys for 25 years.”
Through perseverance, trust in each other, kindness to their employees and customers and a lot of luck, Stamina made it.
Friends, founders and the beginning of Stamina Products
A motif in Stamina’s success is perfect timing, and its inception was no different. Gerschefske, who promoted various concerts and events in Springfield during the early to mid-80s, wanted a career change.
“Better yet, my wife wanted me to do something different,” he quipped.
It was around this time that Laurie approached Gerschefske about the possibility of starting a fitness company. Laurie wasn’t looking for anyone in particular. He asked Gerschefske casually because he didn’t think that Gerschefske would be interested. But for Gerschefske, this was the career change he was looking for. The two had played basketball together for years, and Gerschefske trusted that Laurie knew what he was doing. After all, Laurie was already in the fitness industry. He and his father-in-law, Bill Anderson, owned Health and Fitness Systems, a high-end specialty sporting store located right next to Sears in the late 80s.
So, it was settled. On June 1, 1987, Laurie, Gerschefske and their first investor, Bob Freeman, opened Stamina Products, Inc.
A failed failsafe and a very, scary Christmas Eve
During those first six months, Stamina relied heavily on Laurie’s connections in the industry – for better and for worse. In the case of William Lin of Asia Regent Limited, it was for the better. The partnership with Lin was instrumental in the beginning for they were able to secure manufacturing and source product with Asia Regent. To this day, Stamina’s management regards Lin as one of their most trusted partners.
In the case of their first sales representative*, it was for better… then worse. Without him, Laurie and Gerschefske wouldn’t have met Lin. But it was also their trust in him that led to Stamina’s first faux pas: a double-cashed letter of credit.
It was Gerschefske who confronted the sales rep about the fraudulent letter of credit on a phone call in the late evening of Dec. 24, 1987. But only Gerschefske knows exactly what happened during that Christmas Eve phone call; the salesman died mid-conversation from a massive heart attack.
Concerned and confused, Gerschefske booked the next flight to Denver, Colorado to verify that he had indeed passed away. Laurie and Gerschefske had taken out a key man policy on him in the event of something catastrophic – like a death or fraud. But after his death, they discovered the key man policy was also fraudulent. Ironically, it was because of this fraudulent key man policy that Stamina Products exists today.
“If that key man policy would have been in place – which we did pay for – we would have cashed it in,” Gerschefske said. “That would have been the end of Stamina.”
*Name was omitted to respect the remaining members of the sales representative’s family
A step(per) in the right direction
Laurie and Gerschefske’s decision to persevere was not only out of desperation. They had orders to fill. As Gerschefske said, “It was sink or swim.”
Fortunately, Stamina swam the year of 1988. There were many customers eager to help out Stamina, including Lin and Asia Regent. There was also a Minneapolis-based sales representative group that helped Stamina get their first stair stepper on CVN (now QVC).
Finally, luck was on Stamina’s side. CVN sold out of the Stamina Stepper immediately. To refill their stock, CVN placed a one-million-dollar order. Laurie and Gerschefske were ecstatic, but there was one thing missing: how to finance that one-million-dollar order. That’s where Jeff Hutchens, CEO of Hutchens Industries, entered the picture.
In the 70s, Gerschefske and Hutchens lived in the same apartment complex at Southwest Missouri State (now Missouri State University). So, it wasn’t sheer coincidence that Gerschefske approached Hutchens about producing the Stamina Stepper domestically. Circa 1988, Hutchens Industries manufactured trailer suspensions exclusively. Because of this, they had extensive metal fabrication capabilities and knowledge.
Despite the good meeting, Hutchens didn’t answer Gerschefske right away. It was only by chance that Gerschefske ran into him a month later. This time, Hutchens expressed interest because, once again, timing was in Stamina’s favor. Hutchens was seeking to diversify since Hutchens Industries was completely reliant on the trailer suspension market. So, in 1988 and 1989, Hutchens built a factory in Mountain Grove, Missouri and bought out Stamina’s original investor, Bob Freeman.
Ultimately, Stamina’s domestic production over the next four years led to unprecedented growth. Namely, product placement in Walmart in 1989 and eventually, the addition of partners Brent Swanson and Bob McBride in 1995.
Facing more tough times
Like Laurie, Gerschefske and Hutchens, Swanson and McBride were more than business partners. Their fathers served at the same military base in San Antonio, Texas. Their friendship has endured since Swanson was 15 and McBride was 17. After college, it was McBride that helped Swanson land his first job in the fitness industry at Diversified Products. Both worked at DP for over a decade before moving on to another company in Florida.
After a year, both Swanson and McBride left the Florida company at the same time. This time to buy into Stamina Products.
“There’s not many opportunities in life to do something like this,” said Swanson.
They saw it as an opportunity not only to do something new, but to shape the fitness industry in a way no one had before. And they would need that spark – that desire to do what no one else has done – in coming years. From 1993 to 1996, it was a fight to stay alive. Stamina’s profits fell consistently in the battle to compete against the world’s newest sourcing giant, China. Even worse, the Stamina management also had to make a tough decision one year into Swanson and McBride’s arrival: To shut down the Mountain Grove factory that was only built seven years prior.
“After the first year, my wife looked at me and asked, ‘What did you get us into?’” Swanson said.
Although he had every reason not to, Hutchens continued to financially support Stamina Products. To this day, the other four partners question why Hutchens bothered to invest in a company whose losses mounted every month for several years, but Hutchens’ answer was simple.
“Even when it was tough, we all had everything wagered on Stamina,” said Hutchens. “I just felt like it had a chance, and it did.”
Fortunately, the successful launch of AeroPilates on QVC in 1997 saved the company. Stamina partnered with Marjolein Brugman to develop the first in-home Pilates reformer unit. Since Stamina was new to the Pilates industry, and they had a large stock of reformers they desperately needed to sell. AeroPilates’ first slot was on QVC’s “Today’s Special Value” with Brugman as the guest host. Swanson remembers the moment with one of QVC’s buyers vividly.
“I can still see Daphne [Howard] at the end of the hallway waving her arms because we sold out of all the units,” Swanson recalled.
A five-piece puzzle of success
While key product innovations like the AeroPilates reformer and Hutchens’ continued support were major factors in Stamina’s recovery, there was another major component to the company’s success.
“Perseverance and belief in each other’s abilities got us through,” said Gerschefske. “We were blessed to make it through those times.
The five friends and business partners complement each other perfectly. Laurie, the insightful and reserved co-founder who propelled Stamina’s relationship with their largest distributor, Walmart. He said less than twenty words during the hour interview. Gerschefske, who got stuck with the messy, dirty work: the legal side of owning a company. According to Swanson, he was also the one whose “good at getting things done.” A professional “cat herder.” Swanson, the gregarious salesman; only his ideas are bigger than his personality. McBride, the amiable sourcing and manufacturing expert who maintained strong relationships with Stamina’s factories. And Hutchens, the laissez-faire leader who supports the others with his wisdom and guidance.
When they went into business together, they didn’t just risk losing their investments. They risked their friendship.
As Swanson said: “The old adage is ‘don’t go into business with your friends.’ We went into business with five.”
Although it went well for Stamina, Hutchens would not recommend going into business with friends.
“I think our group is unique,” said Hutchens. “I don’t think you could take another five guys and achieve the same results.”
Trickledown kindness and the pro-consumer approach
Stamina’s management would be the first to say that the company’s success is not just dependent on themselves. It’s because of Stamina’s employees; the ones who have moved on, the ones who are currently employed and the ones yet to come.
“Everyone – from the janitor on up –affects how successful we are as a company,” said Swanson.
Stamina’s leadership wholeheartedly believes the employee experience will make or break a company, which is why employees receive holiday bonuses and profit sharing. According to Swanson, these bonuses are more than a thoughtful business practice.
“Employees become your extended family – except you see them every day,” Swanson said. “You carry their pain and sadness, but also their joy and happiness, home with you. You can’t just forget about them.”
Stamina’s pro-employee approach extends further than within the company itself; it extends to the consumer. According to Swanson, when you treat your employees right, they’ll treat your customers right. And Hutchens can personally testify to this.
“When someone at Stamina answers the phone, they are whoever you’re looking for,” Hutchens said. “They’ll do their best to try to help you and answer your questions.”
Stamina’s pro-consumer approach is most evident in their online sales in the early 2000s. In a time when the web took 10 minutes to download a basic email attachment, Stamina was distributing rowers across the country. Their first online customers? Two members of the Harvard rowing team: Tom Fallows and Jonathan Kibera, the founders of Mercantila. Now, Fallows is Uber’s Director of Global Expansion Products while Kibera went on to found LiveNeighborly, an online service and app where homeowners can book gardeners.
“We embraced small shipments as a company,” said Swanson. “While some of our competitors fought the trend because of the difficulty, we grew accustomed to it.”
It was those companies who fought the trend that failed. Even 17 years later, it’s still demanding. Within the last two years, the sales team, marketing team, customer service and the management team have been out in the warehouse, labeling shipments.
Building a self-maintaining engine
With the exception of this interview, Stamina’s leadership does not revel in hindsight. They prepare for the future armed with the knowledge of the past. Their feelings toward the future are twofold, though. Owning a company is exciting, but it’s constantly nerve wracking – not just in tough times. Even in retirement, Gerschefske still worries.
“We’ve built this engine, but how do you keep it going?” he asked.
And as the rest of Stamina’s leadership inches closer to retirement, they wonder this as well. But they believe it’s this fear of failure that leads to success. Despite their worries, they ultimately believe that Stamina is set up for success. This is especially true for Hutchens.
He said: “[Laurie’s] kids are here. My son is here. I’m enthusiastic. I think it’s going to be even better than it is today.”